Newsletter April 6, 2014
InvestorsFriend Inc. Newsletter April 6, 2014
A Raison d’être
The theme of this edition of the newsletter is that the way for most people to beome relatively wealthy is to invest in profitable corporations through the stock market.
InvestorsFriend.com started out almost 15 years ago as web site devoted to sharing my knowledge of investing. Quite a few years ago I set out the Mission as being to help investors grow rich through more intelligent (more business-like) investing. This weekend I decided to state that a bit more directly. InvestorsFriend.com exists to help people grow rich(er) through more intelligent (more business-like) investing. Or, more succinctly, InvestorsFriend.com exists to help people get rich.
Now some might view that as a rather audacious claim. Some would view it as distasteful. Others as perhaps somewhat preposterous.
Nevertheless, I think helping people get rich, or at least richer, is the reason that this web site exists and finds an audience. There are certainly some people who find the idea of getting rich through investing to be a compelling idea, and who appreciate some help in how to do it.
Lately, I have been thinking about how people can get rich or accumulate wealth. For most people getting rich is going to involve saving and investing money over decades.
The following are a couple of new articles that I wrote on this theme.
Who Gets the Spoils of the Economy?
A modern economy produces an amazing abundance of products and services. Modern grocery stores are filled with a mind-boggling abundance. A Costco store contains a stunning array of high quality goods. Car dealerships are filled with enticing products. Modern homes are comfortable and often have as many washrooms as people. Entertainment is abundant. Communications services are instant, reliable and ubiquitous.
But all of this great abundance is neither created equally nor shared equally.
How to Get Rich
One could argue endlessly about what it means to be rich in financial terms. But most definitions would indicate that being rich means the ability to spend a large amount of money annually and to sustain that for many years, ideally for life. I would argue that while all rich people do not necessarily actually spend a lot each year, having the ability to do so, for many years or indefinitely, if desired is a necessary prerequisite to being rich. What constitutes a large amount of spending per year depends on your perspective and frame of reference and is not a set amount. Most people might agree that those who make say five times more than they do are rich. So a minimum wage earner might consider everyone making $100,000 per year to be rich, while those making $100,000 per year consider that it takes $500,000 per year to be rich. Whatever your definition of what it means to be rich, this article discusses how it might be achieved.
Understanding the Canadian Economy
Every year at this time I update my article that describes the contribution of each sector of the economy to GDP and who consumes that GDP. It also describes what goods Canada exports and imports and which countries are our main trading partners. This year I added which services Canada imports and exports. This article draws a lot of traffic from Google searches, presumably because this information is not that easy to find in one place.
Is the Stock Market Over-Valued?
There is lots of speculation that the stock market may now be over-valued. I have updated two analysis articles that take a look at the evidence. Click the links to see these articles
In the next edition of this newsletter I hope to take a look at the valuation of the Toronto Stock Exchange. Also I plan to explore some thoughts on how wealth is created in the economy and how wealth creation is measured.
InvestorsFriend Inc. offers a stock rating service that has a very good track record. Those who are not already subscribers can learn more by clicking this link.
Shawn Allen, President
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